2:00 PM -- Misery loves company. So as rumors began surfacing in the last week or so that scandal-ridden HP will buy scandal-ridden McAfee, the rumor actually started to make some sense. (See McAfee Shakeup: Poor Timing.) Heck, what's a little pretexting and back-dating of stock options among friends?
So far, the rumor is unsubstantiated. One HP source called it "pure and utter speculation."
Another source, a buy-side analyst, says McAfee may have been trying to sell before its executive fallout. The sticking point with HP was that it apparently only wanted McAfee's enterprise software, not the consumer software (Microsoft wouldn't have been happy with HP selling competing McAfee consumer software), according to the source.
With their top executives departing amid scandals -- HP chairman Patricia Dunn for allegedly spying on her board and McAfee's president Kevin Weiss and CEO George Samenuk for stock-option irregularities -- an acquisition is probably the last thing on the two companies' minds. They've got plenty of rebounding to do as they try get back to business and survive the fallout of execs' bad behavior.
But if they did get together, you can bet the two companies would have plenty to commiserate about over the water cooler. Like, how to trust execs that spy on you or make a little extra off the company stock. Or how best to repair the damage to their reputations.
Even with all the executive nonsense at these companies, things had been looking pretty healthy from the outside. Despite boardroom brawls at HP during the past year and half, its financials have improved. McAfee was poised to enter the compliance control space with its recent purchase of Citadel Security, and has been outspoken in its campaign to ensure Microsoft doesn't steamroll its way into the security software space by locking security companies out of the Vista kernel.
A rumor is a rumor, of course. But you've got to admit that buying a bigger spot in the security market could be a smooth move for HP. And McAfee would get more leverage in its increasingly high-stakes battle with Microsoft. Plus, a pooling of resources would help both companies bail out of the financial fallout of their recent scandals.
Stop right there. It's only speculation.
Kelly Jackson Higgins, Senior Editor, Dark Reading